Are you constructing a structure on your property? Have you recently completed a building on your lot?
If any of your answers to these questions is yes, register your improvement with the local government unit (LGU) where the structure or building is located, and secure its corresponding real estate property tax declaration.
Recently, we had the privilege of interviewing Robert D. Mina, the City Assessor of Pasig City. During the interview, Mina provided insights into the process of property declaration under the Local Government Code of the Philippines.
As per Section 203 of Republic Act No. 7160, property owners who acquire real property or make improvements on existing property are mandated to declare them within sixty days of the acquisition or upon the completion or occupancy of the improvement, whichever occurs first. Mina emphasized that the process is straightforward and the legal requirements are easily comprehensible.
Simplified Steps
Step 1: Prepare the Required Documents
All necessary documents must be prepared as supporting attachments to your letter request for assessment of the building and other improvements to the Office of the City Assessor. These documents include a copy of the approved Building Plans (blueprint), photocopies of the Building Permit, Certificates of Occupancy, and Certificate of Completion. If machinery is involved, a list of machinery with dates and acquisition cost should also be made available. Additionally, a photocopy of the government-issued identification of the property owner is required.
If the application is filed by a representative, a duly notarized Special Power of Attorney (SPA) along with his valid identification must be submitted, in addition to the aforementioned requirements.
If the applicant is not the lot owner, such as a lot lessee, a copy of the lease contract with provision authorizing the lessee to construct improvements on the property is required. For individuals authorized to construct on a lease-free lot, an authorization to construct their residence or other improvements must also be submitted.
Step 2: File the Letter and Required Documents at the Assessor’s Office
Complete the official application form, providing comprehensive details regarding the recently completed enhancements. It is imperative that all submitted documents and information are accurate to prevent any complications during the assessment and tax declaration procedures. Timely registration is also crucial to avoid penalties and surcharges resulting from delayed declaration.
Step 3: Inspection and Verification
The Assessor’s Office will schedule and conduct an inspection to verify the new improvement, its extent, classification, and completion date. During the inspection, the Local Assessment Operation Officer will also determine the Fair Market Value (FMV) of the improvement, based on the local government’s Schedule of Market Values. This value considers factors such as the type of structure, materials used, floor area, and location.
Step 4: Assessment of Real Property Tax
Upon the completion of the inspection and determination of the improvement’s FMV, the process transitions to assessing the real property tax. The Assessor’s Office applies the appropriate assessment level. This assessment level is subsequently multiplied by the FMV to compute the assessed value, which serves as the tax base for the real property tax.
Step 5: Issuance of Notice of Assessment and Tax Declaration
Upon the completion of the assessment process, a Notice of Assessment will be issued by the Assessor’s Office, formally informing the property owner of the taxable value assigned to the newly made improvements. This Notice will also serve as the official record of the property for taxation purposes. A new Real Property Tax Declaration will be prepared, encompassing the owner’s complete name, precise location of the property, classification of both the land and improvements, the determined assessed value, and a unique tax declaration number.
The total duration from receipt of an application to the issuance of a tax declaration can take between seven to twenty working days.
Effectivity
It is important to note that all assessments made within a calendar year shall only take effect on the first day of January of the subsequent year. Nevertheless, many LGUs offer discounts to taxpayers who pay the real property tax in advance.
Variance
Given that specific requirements and procedures vary slightly between cities and municipalities, Mina recommended consulting your local Assessor’s Office for the most accurate and up-to-date information.
* * *
Henry L. Yap is an Architect, Fellow of both Environmental Planning and Real Estate Management, and one of the Undersecretaries of the Department of Human Settlements and Urban Development.
#PropertyReportFeature
#FeaturedStory
